Members are advised that since the update by the Fiji Hotel and Tourism Association (FHTA) on the Vat Monitoring System (VMS) or Electronic Fiscal Device (EFD) Roll Out on 29 May 2019, the Association has been conducting on-going meetings with all the relevant stakeholders to better understand FRCS’ requirements, implication to our members’ business processes, their specific challenges and what will be needed to ensure compliance with this regulation within the 31st July compliance timeframe.
If you have not read up on the VMS requirements, information on the FRCS website that was shared earlier can be viewed here (https://www.frcs.org.fj/news/2019-2/vms-phase-3-rollout/).
We are working very closely with FRCS and on-going discussions with FRCS’s CEO and his VMS Unit, system software & hardware suppliers, members and their Financial Controllers as well as accounting firm reps have thus far provided the following information that we now share with you, to assist with understanding the compliance requirements and ensuring our members prepare to be compliant now:
1. Businesses that must comply.
- Even if you are not included in the list of businesses noted in FRCS’ Phase 3 for VMS inclusion (https://www.frcs.org.fj/our-services/vat-monitoring-system-vms/), you must prepare to be compliant or can volunteer to do so as early as possible.
2. Meeting the 31 st July Timeline
- The supplier of your PMS system MUST be registered and accredited with FRCS (https://www.frcs.org.fj/our-services/vat-monitoring-system-vms/efd-accreditation-instructions/) as a FIRST STEP. This must take place now.
- If you do not have a PMS or POS in your business, you can select a supplier from this list (https://www.frcs.org.fj/our-services/vat-monitoring-system-vms/accredited-pos-esdc/) and request your supplier to indicate a time frame that you can be compliant by.
- The supplier must include your business on his client list which he should provide to FRCS with a timeline for each, noting by when he expects to have your business compliant by (specific dates).
- This information is critical to FRCS considering our request for an extension to the 31st July Compliance Deadline.
3. Understanding Tourism Business Processes
- We have reached out to members to draw up a list of the many systems in use and discussed possible solutions with suppliers
- We are working with FRCS to complete a list of the many “scenarios” that capture the various tourism related transactions that take place as part of normal business processes to determine at what points fiscalisation must be recognised
- We are also working closely with FRCS to develop Standard Interpretation Guidelines (SIGs) or tourism industry specific VAT regulations that would effectively address these scenarios
- If you do not think your business process would have been captured by us, please let us know your specific challenges
4. What Options Do Small Businesses Have?
- We realize that many of our members are small operations that run on intermittent power supply and/or are off the grid for power and internet and that manual processes could be how things are being done currently. After all, being isolated and “unplugged” is probably what your visitors are seeking in the first place. We are working to find available options for this category of business but reiterate that you should also consider talking to an already accredited supplier noted in No.2.
- We are also seeking clarifications on the support being offered by FRCS towards businesses with an annual turnover of less than $500,000 (referred to in their Tax Talk Article 28 June and the 2019-2020 Budget Supplement to the Budget Address, Part 2 Indirect Tax Measures, (i) Value Added Tax Act) where they discuss a free POS system.
5. Feedback
- Members are reminded that they should provide the FHTA Secretariat with feedback on the specific challenges they are experiencing in trying to comply with this new VMS requirement or any other information they believe is relevant to the SIG’s we are compiling.
